GameStop Stock Plummets by Over 25% Intraday After Announcing Bitcoin (BTC) Acquisition Plan

This slump followed the announcement of a strategic pivot involving the issuance of $1.3 billion in convertible bonds to finance the acquisition of Bitcoin (BTC).

GameStop's stock slid more than 25% intraday on Thursday following the announcement of a strategic pivot that includes issuing $1.3 billion in convertible bonds to fund a Bitcoin (BTC) purchase.

The video game retailer plans to sell the 0% convertible senior notes due 2030 in a private offering. The net proceeds will be used for general corporate purposes, including the purchase of Bitcoin, as part of an updated investment policy approved by the company's board earlier this week.

GameStop shares surged more than 14% in Wednesday's after-hours trade but opened Thursday at $25.78 per share and fell to a low of $21.16 per share on the day.

Bitcoin as treasury reserve

This move will see GameStop join corporations like MicroStrategy in putting Bitcoin into their treasury reserves, but the timing and execution have raised concerns among investors and analysts.

"There are question marks with GameStop's model. If bitcoin is going to be the pivot, then where does that leave everything else?" said Bret Kenwell, a U.S. investment analyst at eToro.

The announcement also included plans to close a "material" number of additional stores this year, highlighting ongoing difficulties in GameStop's core retail business. This has further fueled investor skepticism about the company's long-term solvency and strategic direction.

output: GameStop's stock price slid more than 25% on Thursday following the announcement of a strategic pivot that includes issuing $1.3 billion in convertible bonds to fund a Bitcoin (BTC) purchase.

The video game retailer plans to sell the 0% convertible senior notes due 2030 in a private offering. The net proceeds will be used for general corporate purposes, including the purchase of bitcoin, as part of an updated investment policy approved by the company's board earlier this week.

GameStop shares surged more than 14% in Wednesday's after-hours trade but opened Thursday at $25.78 per share and fell to a low of $21.16 per share on the day.

Bitcoin as treasury reserve

This move will see GameStop join corporations like MicroStrategy in putting bitcoin into their treasury reserves, but the timing and execution have raised concerns among investors and analysts.

"There are question marks with GameStop's model. If bitcoin is going to be the pivot, then where does that leave everything else?" said Bret Kenwell, a U.S. investment analyst at eToro.

The announcement also included plans to close a "material" number of additional stores this year, highlighting ongoing difficulties in GameStop's core retail business. This has further fueled investor skepticism about the company's long-term solvency and strategic focus.